A Chinese investor has opened a wall panel production factory along Mombasa Road, targeting real estate developers keen on cutting costs by reducing construction time.
The Chinese businessman, Feng Hui, said in an interview Thursday the factory is designed to produce one million square meters of walling by the end of the year. His company, Hong Kong Building Centre, opened its doors late last year.
Operations are still in early stages, but Mr Hui said he expects to double production from the current 500,000 square metres of wall panels and add more jobs by the end of the year.
“On full production we expect to employ up to 200 workers but for now we are in phase one of production and have 40 workers,” said Mr Hui.
Property developers said that wall panelling, as opposed to the common use of stones, saves costs by speeding up construction.
Kenya’s production of houses estimated at about 30,000 units leaves a big supply gap with demand for new housing estimated at more than 150,000 units every year.
The supply shortage is partly blamed on high construction costs and a lengthy building period.
“The biggest cost savings is on time. You cannot lay more than five layers of stone per day but with precast you can do an entire wall in a day,” said Kimiti Wanjaria, a director at Serene Valley Properties Limited, a real estate development firm.
The ability to put up houses similar to the popular construction toys, Lego, can cut costs by between 10 and 45 per cent.
Mr Wanjaria says that highly skilled masons earn between Sh1,000 and Sh800 per day while the lower skilled workers earn at least Sh400 per day, and reducing the construction period has significant cost savings.
Mr Hui, who said he has been a player in Kenya’s real estate sector for the past 15 years, declined to reveal how he has spent on the new venture or how he raised the funds, terming these as “trade secrets.”
Through his other company, Hong Kong Ceramics Mr Hui says he has been importing to Kenya real estate materials for the past one-and-a-half decade. He said majority of wall panel buyers are retail customers, adding that big developers have been slow to adopt the technology.
Wall panels can be used to construct both residential and commercial buildings. “Big companies are a bit slow because it involves a lot of consultation with the architects and contractors,” said Mr Hui, adding that the large buyers should start showing interest when the next big housing projects start to roll out.
Mr Hui said he is also eyeing the Eastern Africa market, having already recorded some demand from South Sudan and parts of Somalia, two regions that are re-building after decades of war.
Houses and offices built using wall panels offer occupiers slightly more space per square metre since the panels are thinner than stone walls.
Mabati Rolling Mills and the state-owned National Housing Corporation (NHC) are other firms that have factories churning out cheaper building materials.
It began producing pre-fabricated houses in August 2011 to cater for the low-end of the real estate market while the NHC has set up a Sh1 billion factory in Machakos County to produce Expanded Polystyrene (EPS) panels. High cost of land is another factor that makes it difficult for ordinary Kenyans to afford homes.
Suggestions have been made to initiate massive servicing of land in the outskirts of major towns to cut costs for putting up residential houses.